OK, I'll categorise most people into two groups for the sake of the following: Smooths and Shinies.
The Smooths are the ones who appreciate what is below the surface, while Shinies are most interested in external appearance; show versus go if you like. A Smooth will buy a used BMW maybe, while a Shiny will spend the same amount on a new WRX.
I was on the fringe of small-time car scams some years ago. I wasn't doing it, wasn't buying warm stuff, but knew a few of the regular perpetrators. It's a huge loop involving towies, police, wreckers, metal recyclers and migrant communities. The tragedy is that most of the crooks are uninformed "Shinies" and parts get sold not on potential but on appearance and exaggerated claims/ignorance.
To me, it'd be easier to stomach if the stolen items were respected by reincorporation in a cleverly built fashion. But they almost never are. :x
As to legality of registration, I wish they'd create a hotrod category and slot all these cars into it. The way defects law is written, you can't cite something like "MRJUCY" as defence if you get a defect notice.
Cheers, Adam.